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Medical Marijuana: Get Ready for the Rulemaking

If Amendment 2 passes in November, expect medical marijuana to dominate the business of the Florida Legislature in 2015, and probably long after that, say lawyers, lobbyists and a growing number of marijuana information consultants.

Already there are hundreds, perhaps thousands of entrepreneurial ideas afloat to cash in on medical marijuana as an industry in Florida.

"You look at all the polls, this issue is polling above 80 percent favorable across all social groups," said Mark Stein, a partner with the Miami law firm Higer Lichter & Givner. "Naturally, that's going to stimulate the entrepreneurial spirit."

Stein, who has considerable experience helping the business law section of the Florida Bar work with lobbyists and state legislators to craft legislation surrounding businesses and industries, told Sunshine State News he is going full bore, sounding the alarm, as if the amendment passing is inevitable.

"In so many facets of Florida life, nothing will be quite the same from Jan. 1, 2015," Stein said. "There's a great deal to consider right off the bat."

Thinking ahead to November -- assuming passage of Amendment 2 as Mark Stein is -- Michael Elliott of the Medical Marijuana Industry Group, which represents about 50 Colorado dispensaries, reminds Florida, Cannabis doesnt need to be fully legalized to legitimize itself. Its not a stepping stone for patients. This is a medicine.

That medicine is now fueling hundreds of tightly controlled, multimillion-dollar businesses in the Rocky Mountain State, and it will likely do the same in Florida.

Understanding and applying the new Florida law known as ?Charlotte?'s Web? is critical for Floridians. But, claims Stein, it was tightly written, already falls under a newly created state office, applies to only five growers and affects probably fewer than 225,000 patients. Regulation on that bill, the Compassionate Medical Cannabis Act, begins at an all-day Tallahassee workshop July 7.

The real bear, he said, is the wider-reaching ballot Amendment 2, which allows possession and consumption with a doctor's prescription.

"Colorado has been involved in more than a decade-long debate over how to manage medical marijuana.They've been dealing with it since 2000 and even though its regulations are considered meticulous, it's an ongoing thing. A work in progress. It requires tweaking year after year," Stein said.

People need to understand that even when the law goes into effect in January, marijuana is still illegal under Florida and federal law, with very limited exceptions carved out by the Compassionate Medical Cannabis Act,? says David Shiner of the Boca Raton-based Shiner Law Group.

Colorado has created a tight chain of control from seed to sale.Patrick Vo, chief operating officer of?BiotrackTHC, a seed-to-sale software tracking company, said he believes Florida must do the same. ?He points out that in August 2013 the Department of Justice released a memo saying that those states and businesses that implement strong and effective systems of controls will be a low priority for prosecution.

Stein believes Florida can "borrow" a lot of regulatory ideas and language from other states like Colorado, Arizona and Connecticut. But there are factors for businesses special to Florida. "For example," he says, "Florida will be the first state without a state income tax to have medical marijuana.And how does the state intend to set and capture revenue? How many of our banks are going to take deposits from marijuana businesses? So much to be settled."

He expects businesses and public service agencies to divide into interest groups, because each will have a different set of concerns to regulate. The state Department of Health will lead the way, he said. "Law enforcement would be one interest group, public health people would be another. So would growers and retail businesses.

Stein said it's going to be important that the executive and legislative branch of state government work cooperatively.

"What I expect to see is something akin to a blue ribbon panel convened to address regulation, because this is going to be heavy going. These folks are going to have to become experts in very complex minutia," he said. "The law is going to have to apply to some 40 diseases. And, believe me, if you've seen the Colorado regulation spelled out, you'll know it's 130 pages of very painful reading."

Most states with new medical marijuana laws are protecting themselves by including in their regulations hefty doing-business fees which likely will be passed on to consumers.

For example, in Illinois regulators' requirements for opening medical marijuana grow centers and dispensaries include these fees:

-- For dispensaries to sell pot, state officials proposed a $5,000 nonrefundable application fee, proof of $400,000 in assets, a $30,000 permit fee and a yearly permit renewal fee of $25,000.

-- For cultivation centers, the Department of Agriculture proposed a $25,000 nonrefundable application fee, $250,000 in liquid assets, payment of $200,000 upon approval of a permit and a renewal fee of $100,000.

In Colorado, medical marijuana dispensaries are under constant surveillance. State regulators explain the cameras are necessary because each dispensary is technically illegal from the federal government's point of view, so the state goes overboard to keep tabs on each operation.

Security cameras behind black domes watch every corner of every room, covering every inch of each facility. As required under the complex regulatory scheme that state policymakers have crafted, the cameras feeds are transmitted to video screens at the offices of the Colorado Medical Marijuana Enforcement Division. State regulators watch 24/7.

Each of the hundreds of plants growing in the dispensary is tagged with a radio frequency identification chip. Employees must sign in every time they enter the inventory room. The route that the companys trucks take has been precisely outlined and approved by the enforcement division. Even the size of the font on signs posted on dispensary doors is dictated by state law.

"There's a great deal to be thought through, a great deal to do," said Stein. "Some businesses won't be open for at least a year -- the structure just won't be ready."